CATL plans Europe’s biggest battery gigafactory

China’s Contemporary Amperex Technology Co. Limited (CATL), the world’s largest producer of lithium-ion batteries, has announced plans to build what would be Europe’s largest battery plant, in Debrecen, Hungary. At a cost of $7.5 billion, the plant would have an annual production capacity of 100 GW h of batteries—enough to power over 200,000 electric vehicles.

About 40 gigafactories—the industry term for large-scale battery factories— across Europe are now planned to start up by 2035 as battery makers target the region’s projected surge in electric vehicle sales. Hungary, with its relatively low manufacturing costs and high concentration of automotive manufacturers, is fast becoming Europe’s battery production hub.

CATL’s plant in Hungary would supply battery cells and modules to European carmakers, including to its customers BMW, Mercedes-Benz, and Volkswagen, all of which have production in the country. It would be CATL’s second European plant; the company is set to begin building its first—a 14 GW h facility in Germany—by the end of this year.

“There is no doubt that our plant in Debrecen will enable us to further sharpen our competitive edge, better respond to our European customers, and accelerate the transition to e-mobility in Europe,” CATL founder and chairman Robin Zeng says in a press release.

The company says it is examining the possibility of joining forces with local partners to establish European supply for battery materials. As part of its sustainability efforts, CATL says it is considering developing solar power with local partners in Hungary.

Mercedes board member Markus Schäfer welcomed the plans. “With CATL we have a technology-leader as our partner to provide us—as the first and biggest customer of the new plant’s initial capacity​—with top-notch CO₂ neutral battery cells for our next generation EVs in Europe,” he says in a press release.

Earlier this month, South Korea’s SK Innovation announced that it had secured a $2 billion loan to help finance its third European lithium-ion battery plant, a 30 GW h facility it has already begun building in Iváncsa, Hungary, and expects to open in 2024.